Is Exelon Likely to Outperform?

With shares of Exelon Corporation (NYSE:EXC) trading at around $31.35, is EXC an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

The biggest news here pertains to the dividend situation. Exelon declared a Q1 dividend of 52.5 cents per share that is payable on March 8 to shareholders on record at 5 p.m. EST on February 19. That’s the good news. The bad news is that beginning in Q2, the dividend will be cut from 52.5 cents per share to 31 cents per share. Furthermore, the board approved a devised dividend policy going forward. In simplest terms, there is no telling what will happen with dividend payments. The only certainty is that they’re currently unsustainable.

President and CEO Christopher M. Crane stated that there is a lower certainty in returns, and that the company is not looking to take on more risk. He also stated that the biggest opportunity is the growing investment the company can make is in utilities, and that it’s all about value. Merchant opportunities aren’t being ruled out, but they’re not a priority at the moment.

A lot of this story relates to the trends. Therefore, more information can be found in the Trends section. For now, let’s take a look at some important numbers…